June 30, 2021
L Brands filed a Form 10 registration with the SEC to separate its Victoria’s Secret business into an independent public company. The Company’s announced its intention to issue $500 million in Senior Unsecured Notes due 2029 with pricing anticipated in the 5% range. Published reports further indicate that Victoria’s Secret is seeking investors for a $500 million First-Lien Term Loan B with a maturity date in 2028 and an interest rate of LIBOR plus 3% to 3.25%. The approximate $1.00 billion in proceeds from both offerings would be used to fund a cash payment to L Brands as part of the separation deal, which is expected to be completed in August. Click here to request more information.
Last week, Grocery Outlet Holding opened its 400th store located in Hailey, ID (its 10th store in the state). The opening continues its plan for annual new store growth of 10%, or about 35 new stores each year. During its 1Q21 ended April 3, the chain opened 10 new stores and closed one location, ending the period with 389 stores in California, Washington, Oregon, Pennsylvania, Idaho and Nevada, compared to 355 a year earlier. Last month, Grocery Outlet said it is on track to open 36 – 38 stores in 2021. Three to five of those locations will be in the East, including two stores opened in East Norriton and Mount Airy, PA. During fiscal 2020, it opened 35 new stores, finishing the period with 380 locations. Click here to request a list of future store openings.
Six weeks after 7-Eleven Inc. took ownership of the Speedway convenience store chain, the retailer and the Federal Trade Commission (FTC) have come to a final agreement over the transaction. Under the FTC consent order, and 7-Eleven and Findlay, OH-based Marathon Petroleum Corp. (MPC) will divest c-stores in 293 markets across 20 states. The divestures are driven by competitive concerns related to MPC's $21-billion sale of Speedway LLC to 7-Eleven. Click here to request a list of future store openings.
Amazon announced plans to open its first robotics fulfillment center in Parkland County, Alberta in Canada. The new center, set to launch in 2022, is more than 600,000 square feet and will be used to ship small items to customers such as books, electronics, and toys.
The International Brotherhood of Teamsters has voted to put considerable resources against unionization efforts at Amazon facilities around the country. About 99% of more than 1,500 delegates from the Teamsters, which represents more than one million employees across North America that include package delivery, warehouse and trucking workers, voted in favor of the resolution during the union’s 30th annual convention hosted online. Click here to request a list of Amazon Fresh future store openings.
AggData's Sister Companies F&D Reports / Creditntell Launches Retailer Debt Database
New customizable Tool Compiles Key Retailer Debt Information
Industry-leading retail consulting firm Information Clearinghouse, Inc. (ICI), through its F&D Reports and Creditntell divisions, has announced the launch of its Retailer Debt Database, which aggregates all key debt instruments for hundreds of retail companies within a fully customizable interface.
Click here for the full press release.
Rite Aid 1Q22 sales came in at the low end of guidance, held back by lower front-end comps and Elixir (PBM) revenue, but EBITDA hit the high end of guidance thanks to COVID-19 vaccinations. Retail sales grew 5.5% from the 4Q21 Bartell acquisition and stronger pharmacy sales. Pharmacy comps were up 8.2% including the benefit of vaccinations, while front-end comps fell 12% after cycling 1Q21 comps of 14.2% (2.2% two-year stacked comps), which saw strong initial pandemic related demand. The weak cold and flu season also had a negative impact on retail sales and profits. Management noted improvement in acute scripts, but not back to pre-pandemic levels. Rite Aid remodeled and opened seven more flagship stores of the future, bringing the total to 10. The focus remains to test and learn, while management is working on a plan for larger scale remodels, such as rolling out the more successful elements of the flagship stores, including beauty where it is seeing over 20% improvement in sales and better margins. No new stores are planned, while a handful of closures are expected. Management also provided its outlook for FY22, which includes stronger than expected sales growth of 4% – 6%, but lower than expected EBITDA, which will be flat to up 10%. Guidance assumes vaccinations have peaked in 1Q22, and no benefit from booster shots, which could provide a tailwind in 2H22. Management also noted the difficulty in determining the impact on sales from the pandemic, and the future cold and flu season.
Darden’s 4Q21 sales increased 79.5% to $2.28 billion. Same-store sales rose 90.4% compared to the same quarter a year ago and fell just 0.5% compared with the period two years before. Growth was also driven by the addition of 30 net new restaurants, which was partially offset by one less week of operations this year. By brand, same-store sales increased 61.9% at Olive Garden compared to last year and was down 1.5% compared to two years ago; LongHorn Steakhouse’s more than doubled compared to last year and rose 13.5% compared with two years ago. Darden’s fine-dining business, which includes The Capital Grille, has been the hardest hit by the pandemic. This quarter, it reported same-store sales growth of 143% as diners finally returned to upscale restaurants. However, on a two-year basis, same-store sales were still down 10.6%. So far in June, same-store sales across Darden’s portfolio are up 2.5% on a two-year basis.
The Company released an outlook for fiscal 2022, predicting that its total sales for the year will top pre-pandemic revenue. It expects sales of $9.20 billion to $9.50 billion, sales growth vs. pre-COVIDof 5% – 8%, same-restaurant sales vs. fiscal 2021 of 25% – 29%, 35 – 40 new restaurant openings, total capital spending of $375 million – $425 million, and EBITDA of $1.50 billion – $1.59 billion. Click here to request a list of future store openings.
Nordstrom is adding 21 in-store Indochino shops in its stores nationwide. The shops will offer personalized suiting, shirts, chinos and outerwear, with custom suits starting at $429, and chinos and shirts starting at $79. As part of the deal, Nordstrom will offer complimentary alterations for Indochino customers, including those who did not buy their items at a Nordstrom location. To date, 10 Indochino shops have opened inside Nordstrom stores, with another 11 scheduled to open by next week. The shops average about 400 square feet. Founded online in 2014, Indochino currently operates more than 50 locations. Customers, working with sales associates, choose from a wide selection of fabrics and customization options, and then garments are made to their measurements and shipped to their door in two to three weeks. Click here to request a list of future store openings.
SYNNEX’s 2Q21 sales increased 31% to $5.86 billion, which the Company attributed to “a positive IT spending environment.” Operating margin improved 56 bps to 2.5%. Adjusted EBITDA rose 63.2% to $175.6 million. Looking ahead, SYNNEX expects 3Q21 sales of $4.95 billion – $5.45 billion, and EPS is projected to be $1.60 – $1.80. On March 22, SYNNEX and Tech Data announced a definitive merger agreement. The transaction is expected to close during the second half of calendar 2021, subject to shareholder and regulatory approval.
During its 2Q conference call, President and CEO Dennis Polk indicated Synnex’s planned merger with Tech Data remains on track. “We are set up for an effective financing of the transaction. Our proxy has been filed, and our shareholder meeting will be held next week. And, from a regulatory standpoint, we have received clearance from a number of governmental authorities, and expect the rest to process though normal course. As would be expected, the COVID pandemic has led to a few delays in some countries.” Mr. Polk noted that Synnex has received positive feedback from its four main constituents: associates, customers, vendors, and shareholders. When asked about supply chain constraints, Mr. Polk said, “There are constraints pretty much across the board, including client devices, networking, CPUs, and even some displays and print products.” The deal is still expected to close in the second half of calendar 2021.
Home Depot launched its new “Rent Online, Pick-up In Store” technology at its 1,300 rental locations across North America. Customers can now reserve and rent equipment online up to 30 days in advance, including demolition tools like breakers and concrete saws, landscaping tools like tillers and sod cutters, trailers, and moving vehicles. Richard Porter, VP of The Home Depot Rental, commented, “For urgent needs at the job site or in the midst of that weekend project, customers can check availability at multiple locations and make reservations on their phone or other mobile device.” The Company also has opened eight new Rental Centers since January 2021, in Pasadena and Manteca, CA; Calhoun, GA; Maui, HI; Alamo Heights, Midland and Rockwall, TX; and Hampton, VA. In March 2021, Home Depot Rental opened rental operations facilities (ROF) focused on efficiently dispatching larger-class equipment to job sites from a centralized location in Houston, TX and Nashville, TN. Click here to request a list of future store openings and closings.
Yesterday, Sweetgreen, a salad chain and grain bowl restaurant chain with 121 locations throughout 12 states and D.C., filed with the SEC to become a publicly traded company. The Company is not disclosing much yet on its plans for an IPO. On June 21, it submitted a confidential draft registration with the SEC to go public. Such a filing typically means a company will raise a minimum of $100 million. The number of shares to be offered and their price range have not been determined. Sweetgreen restructured last year in the face of a pandemic-driven decline in sales and laid off 20% of its corporate staff. The Company was valued at $1.78 billion in a January funding round led by Chevy Chase, MD-based Durable Capital Partners.
Our Hot Market Report takes a closer look at the Washington D.C. real estate landscape, and provides visual competitive analyses as well as key real estate metrics such as future openings, store count, market share, digital insights, and demographics. Click here to request a copy of the full report.
P.F. Chang’s is expanding its P.F. Chang’s To Go concept, with two new locations in Irving, TX and Orlando, FL. The concept, launched in 2020, features a smaller footprint that provides a solution for online ordering, takeout, catering and delivery. Other To Go units are located in New York City (5) and Chicago, IL (3). P.F. Chang’s plans to have more than 50 To Go locations, including in Colorado, Florida, Texas, New York, Louisiana, Nevada, and Arizona, by the end of 2022. Click here to request a list of future store openings.
American Eagle’s top-line results continue to outpace specialty apparel retailers from two years ago, demonstrating the resilience of the Company’s business model and financial flexibility. 1Q21 sales accelerated 17% from 1Q19, supported by Aerie’s 89% revenue growth (29% of 1Q21 sales), and 40 bps increase at American Eagle (71% of 1Q21 sales). Over the past two years, the Company has opened 106 stores and closed 93, with the majority of closures in American Eagle standalone banners; in FY21, it expects to permanently close another 60 to 80 American Eagle stores in North America. Click here to request a list of future store openings.
On June 25, Le Chateau completed the sale of its intellectual property and assets to Suzy’s Inc. All of Le Chateau’s executives and directors resigned following the closing. The sale comes as Le Chateau looks to complete the wind down of its operations under protection of the Canadian CCAA. Suzy’s specializes in women’s clothing and footwear, with more than 130 stores across Canada.
Empire Company Limited, parent of Sobey’s, reported results for 4Q21 and FY ended May 1. Food retail sales fell 1.3% to C$6.92 billion, as the Company’s results lapped the 4Q20 unprecedented demand driven by the COVID-19 pandemic. Although lockdowns have continued to occur during the quarter, the extreme spikes in activity when COVID-19 impacts began did not occur during the current year. The decrease in sales was partially offset by higher fuel sales at increased fuel prices, the expansion of FreshCo in Western Canada and Farm Boy in Ontario, and an increase in e-commerce sales primarily driven by Voilà. Same-store sales excluding fuel fell 6.1%. The results came against pandemic-driven FY20 gains of 12.7% for 4Q food retail sales and 18% for comps excluding fuel. Even with last year’s extreme growth, the Company still grew overall e-commerce sales by 15%, due to the exponential growth of the Company’s new Voilà business in the greater Toronto area.
Reitmans’ 1Q22 sales jumped 49% to just over $121 million due to an increase in e-commerce sales, partially offset by an overall net reduction of 30 stores. Gross margin was up 1,420 bps to 49.4% due to lower markdowns and promotional activity, partially offset by higher merchandise freight costs as global shipping industry disruption required the increased usage of air freight shipments to meet customer demand. As a result, adjusted EBITDA was positive $6.7 million compared to negative $19.5 million last year. During 1Q22, all stores were closed for 47 consecutive days due to government shutdowns, while the Company fulfilled e-commerce orders. As of quarter end (May 1), Reitmans had closed 181 of its 415 stores (44%) due to government shutdowns, and as of June 22, 57 Ontario stores remained temporarily closed due to significant capacity restrictions.
At Home has leased a 96,000 square-foot former J.C. Penney site in Glenarden, MD, with plans to open the location this summer. Neighboring tenants include Costco, Old Navy, Wegmans, Copper Canyon, Starbucks, and Chipotle. The Company operates 227 stores in 40 states. Click here to request a list of future store openings.
Ahold Delhaize’s Supply Chain Arm (ADUSA Supply Chain) said on June 23 that more than 85% of the grocery retail supply chain supporting the omnichannel brands of Ahold Delhaize USA will be self-distributed by the end of 2022. Five additional distribution centers will be converted to the self-managed network in 2022, bringing the total number of network facilities to 25, up from 17 at the outset of the network’s three-year transformation. The facilities that will transition into the ADUSA Supply Chain network in 2022 include those in Bethlehem and York, PA; Chester, NY; and two fully automated frozen facilities in Mountville, PA and Plainville, CT that will open in partnership with Americold. Thus far in 2021 the ADUSA Supply Chain network has converted procurement services for two facilities in Freetown, MA into the self-managed network and will round out the year by opening two new distribution centers in Mauldin, SC and Manchester, CT, as well as converting procurement services at facilities in Jessup, MD and Carlisle, PA. In addition to bringing a number of distribution centers online in the self-distributed network, the transformation also includes the deployment of AI-enabled forecasting and replenishment technology, an integrated transportation management system and an integrated workforce management system, among other technology aimed at enhancing the network’s efficiency and effectiveness.
In other news, Ahold Delhaize’s Food Lion expanded its Food Lion To Go grocery pickup service to 14 additional stores in North Carolina and Virginia. The Company is continuing to expand the service across its market area.
BBQ Holdings, Inc., the parent company of Famous Dave’s and Granite City Food & Brewery, announced June 25 that it has acquired two restaurant brands, Village Inn and Bakers Square, from VIBSQ, LLC, for an undisclosed sum. The deal is expected to close by the end of July. Village Inn is a restaurant concept with 21 company-owned and 114 franchised locations in the Rocky Mountain region, the Midwest, Arizona, and Florida, among other states. Bakers Square is a pie and comfort food restaurant brand with 13 company-owned locations across the upper Midwest.
TravelCenters of America Inc. (TA) opened its first TA Express in Pennsylvania located in Ronks. TA now has 274 travel centers, including 41 franchised locations.
Albertsons’ United Supermarkets opened a “next-generation” store in Lubbock, TX, that incorporates design changes inspired by the pandemic. The new location, its 12th in the city, will have wide aisles and offer fresh prepared food from an onsite branch of a local barbecue restaurant for curbside pickup.
Click hereto request a copy of this report.
Little Caesars is looking to expand its North Carolina footprint with a goal of developing 25 new units across the Charlotte, NC market by 2024. It is actively searching for both single-unit and multi-unit franchisees looking to grow their portfolios in that region. Currently, Little Caesars has nearly 40 locations open and operating in the greater Charlotte metro area. Click here to request a list of future store openings.
Kohl’s CEO Michelle Gass, also speaking at the NRF Retail Converge conference last week, said the Company was “stronger coming out of the pandemic” due to fundamental business strength, an empathetic employee culture, improved shopping experiences, and customer-focused merchandising. She cited three major trends — comfortable/casual clothing, easy shopping experiences, and value for the dollar — as occurring prior to the onset of the pandemic and later accelerating as COVID-19 spread. The pandemic raised the bar on consumers’ demand for ease and convenience; customers who buy from Kohl’s stores and online are “four to six times” more productive from a sales-generating standpoint. Kohl’s also began offering returns on Amazon orders in 2019, which drives traffic and new customers, and the Company plans to have around 200 Sephora shops inside its stores by the fall, with 400 more to be added next year and about 850 in place by the end of 2023. Finally, Ms. Gass noted Kohl’s reimagined store layouts offer more space within aisles and racks, based on a significant reduction in SKUs, resulting in higher turn rates for inventory and the ability to run more full-price sales and fewer clearance ones. Click here to request a list of future store openings and closings.
Hudson’s Bay Company (HBC) announced that it has spun off Saks OFF 5th e-commerce business as a separate entity. Insight Partners (which was also the investor in the Saks.com spinoff) invested $200 million for a 20% stake, which values the new entity at $1 billion. HBC retains 80% ownership and will receive 3% of net sales. OFF 5th’s 105 stores will operate as a separate entity, referred to as O5, and will remain wholly owned by HBC. HBC received $100 million from the deal; the Company ended 1Q21 with more than $700 million of liquidity after reporting improved 1Q results.
ABC Supply has acquired the assets of Exterior Supply, which operates two locations in Elizabethtown and Somerset, KY. With the acquisition, the Company now has eight locations across the state. Earlier this year, ABC Supply expanded with greenfield openings in Salt Lake City, UT and Port St. Lucie, FL. ABC Supply operates more than 800 locations across the U.S.
Shoe Carnival reported record 1Q21 results, with net sales up 123% and 29% over 1Q20 and 1Q19, respectively. Comps were up 125.8% (including 161% in-store comp growth), following a 42.3% decline in the prior-year period when almost all of the Company’s stores were closed for about half of that period. Online sales were up low double-digits and represented about 12% of net sales. Click here to request a list of future store openings.
Private investment management company Hyde Park Ventures has acquired seven Five Guys franchises and a new development territory across northern Colorado. The move makes it the third largest Five Guys franchisee in the U.S. Click here to request a list of future store openings.
Camping World executed purchase agreements for the planned development of two new RV SuperCenters on approximately 15 acres of land each in Sunbury and Madison, OH. The Company currently has four locations in Ohio and plans to open the new locations for business in fall 2022. Camping World currently has dealerships in operation, agreements to acquire existing dealerships, facilities under new construction, or a land acquisition pending in 45 of the 48 contiguous states. Click here to request a list of future store openings.
Last week, Saker ShopRite opened a new store in Middletown, NJ. It is the anchor tenant in a new retail development.
Last week, Hobby Lobby signed a lease for a new store in the Columbus suburb of Hilliard, OH, its sixth location in the central region of the state. The Company continues to aggressively expand; it has opened 55 new locations during the COVID-19 pandemic. Hobby Lobby has some 900 stores across the U.S. Click here to request a list of future store openings.
Lego Group opened a two-story, 7,175 square-foot flagship of a new experiential retail format at Rockefeller Center in New York City. The format, which blends an array of digital and physical experiences, is modular and fully flexible so it can work in Lego stores of all sizes as well as third-party partner stores. Elements of the format will be added to more than 100 Lego stores worldwide in the coming year. Chief Commercial Officer Colette Burke commented, “While our existing store format has been very successful, we are evolving it to strengthen brand love and create memorable experiences people will talk about long after they leave. We want people to walk into our stores and feel immersed in a world of Lego bricks.” The Lego Group spent two years developing the new concept, which involved a combination of internal teams and external agencies, including Fitch. The concept features 3D Lego builds celebrating local culture and landmarks, a wall of Lego recreations of famous Broadway show and movie posters, a “Brick Lab” themed experience with interactive content, the “Tree of Discovery” reflecting commitment to having a positive impact on society and the planet, and an interactive “Storytelling Table” development area showing early product designs and prototypes. Lego Group operates 7,731 stores globally.
The below retailers recently released their earnings reports. To request more information on these companies, or to discuss the financial performance with a retail industry expert, please click here.
